Broadcom (AVGO) Valuation Debate & Market Impact Analysis (2025-11-26)

On November 26, 2025 (18:20 EST), a Reddit discussion argued Broadcom is overvalued, citing bearish points (VMware price hikes driving customer attrition, slower growth vs peers) and bullish counterarguments (AI catalysts, long-term track record, VMware reducing cyclical risk).

[5]

Broadcom outperformed the market on Nov 26:

• Intraday:
  +3.26% to $397.57, volume (28.08M) above 20-day average (24.52M) [0]
• Recent Momentum:
  5-day gain (+15.18%), YTD (+71.38%) [3], driven by AI catalysts (Google Gemini3, Meta TPU rumors) [2]
• Sector Comparison:
  Tech sector rose +0.149%—AVGO’s gain was 21x higher [4]

[0], [3], [2], [4]

##3. Key Data Extraction

Metric	Value	Source
Market Cap	$1.87T	[0]
P/E Ratio	102.20x	[0]
Q3 2025 Revenue	$15.95B (+22% YoY)	[0]
AI Semiconductor Growth (Q3)	+63% YoY	[0]
Revenue Split	58.4% Semiconductors /41.6% Software	[3]
1-Year Performance	+148.99%	[3]

Notable: 102x P/E is above industry averages; AI growth offsets VMware concerns.

[0], [3]

##4. Context for Decision-Makers

• Exact VMware retention rates [1]
• AMD/Nvidia Q3 growth rates [2]
• AI revenue breakdown

• Bearish:
  High valuation (102x P/E), VMware attrition (AT&T lawsuit) [1]
• Bullish:
  AI growth (63% YoY), long-term track record (906% 5-year growth) [3]

• Valuation risk: 102x P/E unsustainable if AI growth slows
• VMware attrition: Impacts software revenue (41.6% of total)
• Competition: Nvidia’s AI dominance

• Q4 earnings (Dec11) [2]
• Google/Meta AI deals [2]
• Valuation vs peers

[1], [2], [3]